Hi Jim & Brian, RE: "get it at 3 and sell at 16."
These are obviously old grants. The IRS doesn't let public companies grant options way below market, which is why it's obvious these are old grants. So when was INTC $3? Around 10 years ago, 4 splits ago, so that makes 500,000 / 2**4 = 31,250 options. ( Not exactly sure what the rules are on grant prices for privately held companies since market value is somewhat subjective, not something you can simply look up on Yahoo, but instead is set by boards. )
Is 31,250 a lot of options for a high-level executive? I don't think so. 500,000 sounds extreme, but if his 31,250 turned into 500,000 because he held onto them for ten years, that's his risk and his gain.
Regards,
Amy J |
